When Goliath shares with David: The effects of asymmetry on collaboration

Partners in R&D alliances and joint ventures are rarely symmetric, yet whether asymmetry helps or hurts collaboration is not fully understood. We study how asymmetry in competitors' information endowments affects collaborative knowledge exchange. A model of word-of-mouth communication predicts a clean separation: Initiating the knowledge exchange requires that the informational advantage sac rificed be sufficiently small, while the continuation incentive is independent of the initial endowment (and asymmetry). In a laboratory experiment, we confirm the model's comparative-statics predictions and establish three results. First, initiation rates decline as initial asymmetry increases, holding the better-endowed partner's initial endowment constant. Second, conditional on initiation, the initial asymme try does not predict defection later in collaboration. Third, extreme asymmetry reduces match length and joint surplus because initiation fails, not because continu ation breaks down. The initiation-continuation separation implies that governance mechanisms targeting the formation margin (such as pilot projects, phased disclo sure agreements, or credible commitments to reciprocate) can expand the range of asymmetric partnerships that succeed, while continuation requires no special intervention.